Xi’s Blockchain Push Triggers Frenzy in China Technology Stocks

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Xi’s Blockchain Push Triggers Frenzy in China Technology Stocks (Bloomberg)

  • On the back of President Xi Jinping’s weekend comments that China should be pushing Blockchain technology faster, 60 Chinese tech stocks were suspended limit up (even if they had little to do with Blockchain).
  • Over the weekend, Bitcoin rose over 30% to touch $10k after trading at $7.5k last week (although we are still way below peak-blockchain levels of over $18k).
  • China’s state media, the People’s Daily, later commented that investors should avoid speculative behaviour, writing “[t]he future is here for blockchain, but we need to stay rational”.

Analysis and Comments

  • It might be deliberate timing, given the issues Facebook are having getting their Libra crypto-currency up and running. Whilst Zuckerberg grapples with a grilling from lawmakers and regulators on how Libra will get off the ground, as well as partners such as Mastercard, eBay, Booking.com, Visa and PayPal bailing on the project – it is interesting that the Chinese chose now to promote the merits of blockchain technology.
  • If you think the hype returns, then Wall Street view is that the IT consultants (Accenture, Cap Gemini and Cognizant) are best placed, along with specific names such as GB Holdings, Plus500, Overstock.com, SBI Holdings , Nvidia and IBM
bitcoin blockchain china steemleo palnet ctp blog news cryptocurrency technology
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Hello dear friend @vlemon.

The adoption of crypto and blockchain by the Chinese government cannot be assumed as an unrestricted endorsement of current models such as BTC.
According to statements by senior representatives of the Chinese communist party, this launch will have a disruptive influence on the future of the global economy, as it would eliminate both Libra, other national cryptocurrencies and even the traditional SWIFT system, underlying banking transactions.

Therefore, the idea of ​​implementing blockchain in China seems more like wrapping up its own particular concept. Perhaps focused on domestic consumption and as a way to avoid the economic and tariff sanctions imposed from the EEUU.

On the back of President Xi Jinping’s weekend comments that China should be pushing Blockchain technology faster, 60 Chinese tech stocks were suspended limit up (even if they had little to do with Blockchain).

This looks like a FOMO reaction and maybe it would be treading speculative ground

All best, Piotr.

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